Written on Tuesday, February 23, 2016By Kumar Pushpraj

We conducted an interview of Mr. Sanjay Parekh and Ms. Anju Chajjer, fund managers of Reliance dual advantage fixed tenure fund IX. During the conversation, they explained every aspect of the NFO closing on 1-3-2016. Read the complete interview to know more about this fund from Reliance.

1. From an investor’s perspective, what is the objective of Reliance dual advantage fixed tenure fund IX?

The Scheme seeks to lock in the current market yields for the tenure of the fund by investing in fixed income securities that are maturing on or before the maturity of the Scheme along with capital appreciation through equity exposure.

Investment Philosophy for Fixed Income

The scheme will invest in AAA & AA rated instruments and lock in the current yields and these securities will mature on or before the maturity of the scheme.

Investment Philosophy for Equities

The Strategy will be to invest into Reliance Top 200 fund exposure would be around 20% of total corpus, which in turn will invest in companies whose market capitalization is within the range of highest & lowest market capitalization of S&P BSE 200 Index.

2. How this fund is different?

Currently there is a separate category of close ended hybrid funds in the industry which typically consists of funds which invests majorly into debt and around 5-20 in equities.

Reliance Dual Advantage IX Plan A is one such hybrid close ended debt fund, that endeavors to invest on an average of 80%-85% in assets in Debt Securities (Predominantly in NCDs) & Money Market Instruments and the remaining 15% - 20% in Equity & Equity related instruments/ securities.

Further on, the 80-85% of the debt portfolio shall be AA rating oriented, which would help to provide stability to the portfolio. While the rest 15-20% will be invested in Reliance Top 200 fund – a large cap oriented fund that will help to generate considerable alpha by the means of active management.

3. If we about conservative investors, can this plan act as their entry door to world of equity?

Yes, this is an appropriate tool for conservative investors for the very nature of investing its major portion in debt which will give stability by reducing the downside & help to protect the capital upto certain extend. Investments in equities will help to generate alpha.

Reliance Dual Advantage Fund IX Plan A will be investing predominantly into fixed income instruments and equity & equity related instruments/ securities has the potential to deliver equity market returns on the upside (when equity markets are positive) while attempting to limit the loss on the downside (when equity markets are flat-to-negative).

4. What is the tenure of this fund? Is it possible for an investor to redeem a part or entire unit before the maturity date?

Tenure of the fund is 1227 Days with maturity date of 5th June 2019. Due to the nature of the scheme units can’t be redeemed before the maturity of the scheme. Units of Reliance Dual Advantage Fund IX Plan A are listed on exchange, so the units held in dematerialized form can be traded on exchange.

5. Once the NFO period (16/2/16 to 1/3/16) is over, is the plan going to comeback for subscription?

As the nature is close ended, it is not possible to generate units post the NFO period.

6. Tell us about the entry and exit load this fund carries and if there is any option for investor to inter switch within the plans of the scheme?

There is no entry or exit load in the scheme.

7. Anything else you would want investors to know about this fund?

Reliance Dual Advantage Fixed Tenure Fund IX Plan A is Maturing in July 2019 which makes the investments in this fund eligible for 4 indexations benefit (as per the current tax provision)